CENTRAL GOVERNMENT TO PRESCRIBE ACCOUNTING STANDARDS

The provisions pertaining to company accounting are covered in Chapter IX of the Companies Act, 2013 (CA 2013), which is comprised of Sections 128 through 128. According to Section 133 of CA 2013, the Central Government may specify accounting standards. The Ministry of Corporate Affairs (MCA) has announced Section 133 of the Companies Act, 2013... Continue Reading →

POWER OF COMPANY TO PURCHASE ITS OWN SECURITY

The ability of a corporation to buy its own securities is covered in Section 68 of the Companies Act of 2013 and the Companies (Share Capital and Debentures) Rules, 2014. Buyback sources include:  A corporation may use the profits from the sale of any shares or other specified securities, its free reserves, the securities premium... Continue Reading →

VARIATION OF SHAREHOLDERS RIGHT

Rights that the Shareholders enjoy- Dissenting shareholders are granted certain rights under Section 48(2) of the Companies Act, 2013. Section 48(2) states that in the event that the rights of any class of shares are modified, the holders of not less than 10% of the issued shares of that class, who are individuals who did... Continue Reading →

                     RED HERRING PROSPECTUS

A red-herring prospectus is a document distributed by a company planning to sell shares for the first time that contains information about the company but not the price of the shares or other pertinent information. It is distributed to those who might be considering purchasing shares. A corporation will often release a red herring prospectus... Continue Reading →

WHAT IS A SMALL COMPANY

The Companies Act of 2013 established the idea of a "Small Company" for the first time in India. Providing various exemptions, privileges, and liberation with a lower compliance burden on the businesses that are smaller in size and activity is a new step in the de-regulation of entities. By raising the thresholds for paid up... Continue Reading →

ROLE OF A PROMOTER

In accordance with section 2(69) of the Companies Act of 2013, a "Promoter" is someone who: (a) A person who has been identified as such in a prospectus or by the company in the annual report under Section 92;   (b) A person who has direct or indirect control over the affairs of the company, whether... Continue Reading →

WHO IS AN INTERESTED DIRECTOR?

Due to the fact that the directors of a business are its representatives and are obligated to behave in good faith, the Companies Act of 2013 established stringent rules including Section 184 to guard against the abuse of authority by the directors. In order to prevent a director from voting or participating in discussions regarding... Continue Reading →

               DIFFERENT TYPES OF SHARE CAPITAL

According to Section 2(84) of the Companies Act,2013, 'share' means a share in the share capital of a company and includes stock. NATURE OF A SHARE (a) A share is a right to a specified amount of the share capital of a company, carrying with it certain rights and liabilities while the company is a... Continue Reading →

ISSUE OF SWEAT EQUITY SHARES

Sweat equity shares, as defined by section 2(88), are equity shares that a company issues to its directors or employees at a discount or for something other than cash in exchange for their expertise, or in exchange for making available rights in the form of intellectual property rights or value additions, by whatever name called.... Continue Reading →

PROCEDURE FOR RECTIFICATION OF NAME OF A COMPANY 

According to Section 16 of the Companies Act, if a company (whether on its first registration or on its registration under a new name) is registered by a name that is identical to or too nearly resembles the name of a company already in existence, rectification of the name of the company is required to be... Continue Reading →

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